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China's shares rise as telecoms strengthen on hopes of industry restructuring

China's shares rise as telecoms strengthen on hopes of industry restructuring

China's shares rose Thursday due to interest in telecoms stocks on hopes Beijing will soon restructure the industry and launch third-generation mobile service.
The benchmark Shanghai Composite Index rose 1.4 percent to 5,308.89 points. The Shenzhen Composite Index rose 1.4 percent to 1,453.47.
Telecom stocks rose after the State Council said Wednesday it approved in principle the rollout of a "new-generation broadband wireless network," which analysts said probably meant the long-awaited issuance of 3G licenses.
China United Telecom jumped 8.3 percent, while ZTE Corp. soared 7.4 and Bright Oceans Inter-telecom rose by the maximum daily 10 percent limit.
The government statement fueled hopes of a restructuring, said Shanghai Securities analyst Zheng Weigang.
"There are hopes, for example, that telecommunication companies may consolidate or receive asset injections," said Zheng.
Bank and property stocks also rose as fund managers made year-end purchases before the final trading day of 2007 on Friday.
Bank of Communications rose 3.9 percent, while Industrial & Commercial Bank of China gained 3.3 percent.
"Investors dumped a lot of bank and property stocks earlier this month after Beijing said it was going to tighten its monetary stance. Both sectors are rebounding today because there aren't a lot of bank and property shares left to sell," said Guosen Securities analyst Tang Xiaosheng.


Updated : 2021-01-18 19:45 GMT+08:00